More Abuse Of The Orphan Drug System: Taking Treatment From Free To $80,000 A Year

from the regulatory-loophole dept

Last year, we wrote about a disturbing abuse of the orphan drug system in the US, which is designed to encourage the development of treatments for rare diseases, but which in practice can allow companies to increase prices hugely. Here's another example, reported by Adam Feuerstein in The Street, that is in some ways even worse. It concerns a company called Catalyst Pharmaceutical Partners, which has just reported what seems like good news for those suffering from Lambert-Eaton Myasthenic Syndrome (LEMS), a progressive, muscle-weakening disease. Catalyst has announced positive results from a final phase trial of a drug called "Firdapse." As The Street article reports, analysts believe that once approved by the US Food and Drug Administration, Firdapse could cost between $60,000 and $80,000 per year if it is designated an orphan drug, which brings with it seven years of marketing exclusivity. That might seem the going rate for new drugs, but there's a nasty twist in this tale, as Feuerstein notes:

Firdapse is not a new treatment for LEMS. The active ingredient in Firdapse is a compound known as 3,4-Dap, which has been available in the U.S. for more than 20 years. Doctors treating the small numbers of LEMS patients in the U.S. can obtain inexpensive 3,4-Dap from compounding pharmacies. It's even given away for free to doctors and patients by a tiny New Jersey drug maker, Jacobus Pharmaceuticals.

That means that Catalyst took no risks with Firdapse. Indeed, it didn't really do anything at all, as Feuerstein explains:

The company did no development work, made no effort to improve the drug's efficacy, safety or convenience for patients.

And yet despite that fact, it stands to profit handsomely:

For the zero work done by Catalyst, LEMS patients and their insurance companies will be paying as much as $80,000 for the exact same drug they use now for a fraction of the cost, if not gratis.

I can think of no possible reason, no public good that comes from taking a drug that was easily available and working exactly as it should and have someone suddenly be able to charge $80,000 a year for it. This is not a reward for innovation or risk-taking -- this is exploitation of a regulatory loophole, a blatant shakedown, or so it seems to me.

Retrophin hasn't done any new trials, and they haven't had to. They've just bought someone else's old drug that they believed could be sold for twenty times its price, and have put that plan right into action. No development costs, no risks whatsoever -- just slap a new sticker on it and put your hands over your ears. This is exactly the sort of thing that makes people go into fist-clenching rages about the drug industry, and with damn good reason. This one enrages me, and I do drug research for a living.

He's probably not alone in being enraged, but this kind of abuse is so lucrative for the companies prepared to take this route that we're probably going to see more of it until this particular loophole is closed.

Reader Comments

It takes a special kind of scum...

Politicians can be nasty, self-serving, hypocritical and backstabbing assholes.

Layers, lobbyist, likewise.

A cop can ruin your life, rob you blind, shoot up your pets and house, potentially kill you or someone you know, all on a whim, and with absolutely zero repercussions, but even that's on an individual level.

But honestly, you'd be hard pressed to find a more vile, evil, twisted and sociopathic group than the people who run large pharmacy companies. They intentionally price life-saving drugs out of the range of many people around the globe, directly leading to massive suffering and deaths. They re-package the exact same crap once the patent on it is about to lapse by adding some useless 'addition' to it and therefor lock out affordable generics for an extra decade or two before doing it again once that patent is about to lapse.

They pay generic drug manufacturers money in order to keep affordable generic drugs off the market, allowing them to continue to charge obscene amounts for the identical 'brand name' versions.

And all of that for nothing more than money.

And then to turn around and have the absolute gall to claim that they are doing all this in order to save lives(when they aren't bluntly stating that they don't care if people who can't pay suffer or die), as though offering drugs at reasonable prices would somehow utterly destroy their ability to make enough of a profit to stay in business... yeah, you're talking about evil to the point where burning down an orphanage or hospital with the people still inside it for chuckles practically ranks alongside helping the homeless in comparison.